Hybrid Appraisals

[J Grant]

That would be a BIG change to allow for a retro effective date or require a hypothetical for current condition/effective date.

sputman, this isn't directed at you, I'm just trying to make a point.

The rub is there are only two report options and neither are "hybrid." How can any knowledgeable and experienced appraiser put together a GSE report with all of the required show you work adjustment data, market condition analysis and illustrations, required comp verification, etc. for AMC fees of around $120 with 24-48 turn time? And let's not gloss over that if this becomes the norm an appraiser trying to make a living would have to complete several a day, day after day after day. I get there a few coach and team systems out there, but we all know the game and one has already been busted (but they have been forgiven-imagine that). There's no money in hybrids for indie appraisers, but the AMCs and coach/system firms are making bank.

A desktop short-form hybrid is the one with these super low fees.

However the 1004 Hybrid the tentiteis are hawking for res orgination loans still will pay the appraiser less, whether the appraiser does the decskp analysis appraisal part or the PDC collection part. I have no idea what fees will average for the appraisal part, but the AMCs will drive them down as low as possible, as they do for any other product.

 

[sputnam]

That would be a BIG change to allow for a retro effective date or require a hypothetical for current condition/effective date.

sputman, this isn't directed at you, I'm just trying to make a point.

The rub is there are only two report options and neither are "hybrid." How can any knowledgeable and experienced appraiser put together a GSE report with all of the required show you work adjustment data, market condition analysis and illustrations, required comp verification, etc. for AMC fees of around $120 with 24-48 turn time? And let's not gloss over that if this becomes the norm an appraiser trying to make a living would have to complete several a day, day after day after day. I get there a few coach and team systems out there, but we all know the game and one has already been busted (but they have been forgiven-imagine that). There's no money in hybrids for indie appraisers, but the AMCs and coach/system firms are making bank.

'Hybrid' isn't a report option. It's the appraisal. It speaks to the Scope of Work. A hybrid appraisal can be communicated orally, on a form, or by narrative. If it's a written report, it can be an appraisal report (form or narrative) or a restricted appraisal report (form or narrative).

 

[Joe Flacco]

It's exactly the same as a desktop.

 

[sputnam]

It's exactly the same as a desktop.

Right.... except the subject info you have is from a property data collector instead of MLS, public records, etc.

 

[Non Sequitur]

'Hybrid' isn't a report option. It's the appraisal. It speaks to the Scope of Work. A hybrid appraisal can be communicated orally, on a form, or by narrative. If it's a written report, it can be an appraisal report (form or narrative) or a restricted appraisal report (form or narrative).

I don't dispute that. In the context of GSE hybrids they are form reports completed under Standards Rule 2-2(a) [Appraisal Report] with all of the bells and whistles the GSEs expect under their SOW. The only difference is the "who" completing the field work (and no comp driving IIRC). If anyone thinks $120 a pop with 24-48 hour turn time will keep indie appraisers a viable industry, I question their judgement and motivations.

 

[George Hatch]

Of all the fees in the RE food chain, the modest fees of even traditional appraisals in the hundreds of dollars keep being carved up for no purpose whatsoever, except that some "bean counter" keeps coming up with new ways to do it, thus seeing even more competent appraisers either turn down res lending work for AMC's or leave the profession. That is all it is accomplishing.

It does not save a consumer any significant amount of money when the consumer is spending thousands and tens of thousands on loan fees, points, and junk fees and then adds in more tens of thousands in RE commissions. A hard sell that saves $50 on an appraisal is going to make any difference to a consumer's financials.

The only ones profiting off carving up assignments into fast food pieces are the AMC's who are the main ones ordering the PDC and have an endless supply of chumps available for it, since no appraisal license is needed for the inspection portion. They can squeeze more volume from staff appraisers and give them work far out of a geographic area of expertise.

All of that can and is true while at the same time being completely irrelevant to the lenders who are the ones making these purchasing decisions. IRL the AMCs don't impose upon the lender what they can and cannot buy in the marketplace. It's not the AMCs who are making these choices. They're just collecting the lists of assignments that their clients send to them and proceeding as instructed.

Your/Our well being and how many appraisers are getting starved out of the business are irrelevant to these lenders. Appraisers lives don't matter to them. At those levels in suitWorld these lenders don't care enough about appraisers to either like or dislike them. There's nothing personal about it for them; it's just business. $350 is cheaper than $355 dollars. 6 days is quicker than 7 days.

I think more appraisers are going to get starved out and/or not replaced when they retire of die. The number of appraisers will decline over time, PAREA or not. Not all of the incumbents are going to make it, let alone thrive at it. There's not much reason for appraisers to be optimistic about their futures because it's probably going to end up getting harder as we go.

We haven't even touched the potential impacts of artificial intelligence. Before the technology gets done with us that "leveraging the resource" is going to get dialed all the way up to maximum volume.

 

[Joe Flacco]

Just don't worry about it. The topic is way over hyped and over discussed.

They need the appraisal fee to be $120 for it to be feasible but that's just not going to work.

If somebody charges $300 normally and charge $100 for finals, then they value the appraisal portion at $200.

If somebody charges $500 normally and charges $150 for finals, then they value the appraisal portion at $350.

If somebody charges $1000 normally and charge $200 for finals then they value the appraisal portion at $800.

They wasted their time on hybrids. It is not a model that will work.

 

[Joe Flacco]

I think at $200 for the appraisal portion there would be a lot of takers. It would make sense for those doing appraisals with inspections for $300.

But then at $200 the hybrid probably costs more than the appraisal will h inspection.

It's not a model that is feasible.

 

[Joe Flacco]

The problem with it is the AMC needs to charge their fee twice. Once for the inspection and once for the appraisal. That is why the model doesn't work.

I think waivers are more of a threat than hybrids.

 

[Non Sequitur]

A desktop short-form hybrid is the one with these super low fees.

However the 1004 Hybrid the tentiteis are hawking for res orgination loans still will pay the appraiser less, whether the appraiser does the decskp analysis appraisal part or the PDC collection part. I have no idea what fees will average for the appraisal part, but the AMCs will drive them down as low as possible, as they do for any other product.

Several examples have been posted, and I personally completed a few as a test drive for a national lender at $120. Here's a recent example posted on Facebook, a 1004 Desktop with a 1007 addendum, net $155 to the appraiser. FYI, I get $150 for standalone rent addendums in my market.